IDFC Bank net profit rises 48.1% to Rs 503 crore

MUMBAI: IDFC First Bank reported a 48.1% jump in net profit to Rs 503 crore for the third quarter ended December, from Rs 339 crore in the corresponding quarter last year. The increase was helped by higher core income, lower sequential provisions and an improvement in asset quality.
The bank’s bottom line improved aided by stronger operating income and controlled credit costs. Provisions increased 4.5% year-on-year to Rs 1,398 crore, but fell 3.7% sequentially, indicating stabilising asset quality. Tax expense rose to Rs 133 crore in line with the higher profit base.
Business growth remained strong, with advances rising 21.4% year-on-year to Rs 2.8 lakh crore, led by retail and MSME segments, which accounted for 89% of incremental growth. Deposits grew 22.9% to Rs 2.82 lakh crore, driven by a 33% rise in CASA deposits to Rs 1,50,350 crore, taking the CASA ratio to 51.6%.
Net interest income (NII) increased 12% year-on-year to Rs 5,492 crore, supported by balance-sheet expansion and stable margins. Other income rose to Rs 2,125 crore, led by a 15.5% increase in fee income and higher trading gains. Operating income grew 14% to Rs 7,617 crore, while operating expenses rose 13.4% to Rs 5,584 crore, including a one-time Rs 65 crore impact from the new labour code. Excluding this, expense growth was lower.
Asset quality improved, with gross NPAs declining to 1.69% from 1.94% a year earlier. The bank’s capital adequacy ratio strengthened to 16.22% after the conversion of Rs 7,500 crore of compulsorily convertible preference shares into equity.
For the first nine months of the year, the bank’s cost-to-income ratio eased to 71.8%, while return on equity stood at 4.11%, reflecting operating leverage as the retail-led franchise scaled up.